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Judgment
S.N. Jha, C.J.—The Claimants of claim case under Motor Vehicles Act, Who were respondents in the connected LPA Nos. 34 and 35 of
2002, titled National Insurance Company Ltd v. Mohammad Sultan Asim and Ors., seek review of the judgment and order of the Division Bench
dated 2nd December, 2002 in the aforementioned appeals allowing in part the appeals of the Insurance Company and modifying to that extent the
award of Motor Accidents Claims Tribunal, Srinagar
In view of the nature of the present petition and the arguments advanced by counsel for the parties, it is not necessary to notice the facts of the
case. Suffice it to say that a motor accident took place on 20th April, 1997 at Laveypora, Srinagar, in which claimant Mohammad Sultan Asim,
who was driving scooter enroute to Magam from Srinagar, sustained injuries and his son, Suhail Sultan, who was sitting on the pillion seat, lost his
life when the scooter was hit by a bus bearing registration no JKB-8766 driven by Manzoor Ahmad Ganai. The Insurance Company resisted the
claim which Mohammad Sultan Asim and others lodged before the Claims Tribunal for compensation, inter alia, on the ground that the driver did
not have effective driving licence at the time of accident. It is relevant to mention here that neither the owner of the vehicle, S. Harbans Singh, nor
the driver appeared in the proceedings to contest the claim. As a result, they were set ex-parte. Upholding the claim of the claimants, the Claims
Tribunal, vide judgment and award dated 13th April, 1999, awarded compensation of Rs. 29, 78, 530.75 with interest at the rate of 12% on the
sum of Rs. 7, 37, 330/- from the date of institution of the case as also cost of Rs. 15, 000/-. In the other case, sum of Rs. 2.88 lakhs with interest
at the rate of 12% from the date of the claim was awarded. The Insurance Company challenged the award before this Court in CIMA nos. 45 and
46 of 1999. By judgment dated 26th September, 2001, the appeals were dismissed by a learned Single Judge. The Insurance Company preferred
letters patent appeals, being LPA nos. 34 and 35 of 2002, which were allowed in part, as stated at the outset, giving rise to these petitions for
review by the claimants.
Mr. R.A. Jan, learned counsel for the review petitioners, submitted that the Division Bench entertained the appeals and interfered with the
quantum of compensation placing reliance on the decision in United India Insurance Co. Ltd. Vs. Bhushan Sachdeva and Others, , which was
overruled in National Insurance Co. Ltd., Chandigarh Vs. Nicolletta Rohtagi and Others, . The judgment being 'mistaken in law', is fit to be
reviewed.
The submission of the counsel gives rise to the question as to whether a decision subsequent to the decision on the basis of which the case is
decided can be a ground for review of the judgment and order.
Mr. Jan submitted that decision subsequent to the judgment under review may not be a ground but if such decision was prior to the judgment,
the court can review the judgment. According to the Counsel, an 'erroneous judgment' can be challenged only by appeal but a judgment in
ignorance of earlier binding decision would be a 'mistaken judgment' which can be reviewed. In support of the proposition he placed reliance on a
Full Bench decision of the Himachal Pradesh High Court in The Nalagarh Dehati Co-operative Transport Society Ltd., Nalagarh Vs. Beli Ram
etc., .
At this stage, the significance of the decision in National Insurance Co. Ltd v. Nicolletta Rohtagi (supra), may briefly be pointed out. But before
we refer to the decision, we may mention that section 149(2) of the Motor Vehicles Act restricts the right of the Insurance Company to defend
itself only on specified grounds sub-section (1) of section 149 of the Act fasten the liability to satisfy judgments and awards against persons insured
in respect of third party risk on the insurer as if he were a judgment debtor in respect of the liability under the insurance policy. Sub-section (2)
provides that no sum shall be payable by the insurer under sub-section (1) in respect of any judgment or award unless he had notice of the
proceeding. The insurer to whom notice of proceeding is so given is entitled to be made party to the proceeding and defend the action on grounds
that there has been a breach of a specified condition of the policy or that the policy is void on account of non-disclosure of material fact or
misrepresentation of a material fact or particular. Section 170 of the Act, however, entitles the insurer to contest the claim of the claimants on all or
any of the grounds available to the person against whom the claim has been made, in case of collusion between the person making the claim and
the person against whom the claim is made or where the person against whom the claim is made has failed to contest the claim. This right is subject
to the satisfaction of the Claims Tribunal in that behalf for reasons to be recorded in writing. In National Insurance Co. Ltd. v. Nicolletta Rohtagi
(supra), it was held that in appeals u/s 173 of the Motor Vehicles Act against the judgment of the Claims Tribunal by the Insurance Company the
grounds of challenge are limited to those provided u/s 149(2) of the Act. But where the conditions precedent embodied in section 170 of the Act
are satisfied and the Claims Tribunal passes an order permitting the insurer to avail of the grounds available to the person against whom the claim is
made, he can contest the claim on such grounds and in case of an adverse award, can file appeal challenging the quantum of compensation or the
finding regarding the negligence of the offending vehicle. The contrary view expressed by the two-Judge Bench in United India Insurance Co. Ltd.
v. Bhushan Sachdeva (supra) was not approved by a larger Bench. It is thus submitted on behalf of the review petitioners that as the basis of the
judgment of the Division Bench, namely decision in United India Insurance Co. Ltd. v. Bhushan Sachdeva (supra) had become non-est, the
judgment is fit to be reviewed. It was pointed out that the decision in National Insurance Co. Ltd v. Nicolletta Rohtagi (supra) was rendered on
17th September, 2002 Prior to tile judgement under review dated 2nd December, 2002 (record reveals that the appeals were finally heard on 6th
November, 2002).
The explanation appended to rule 1 order XLVII of the CPC lays down;
The fact that the decision on a question of law on which the judgment of the Court is based has been reversed or modified by the Subsequent
decision of a superior Court in any other case, shall not be a ground for the review of such judgment.
The word 'Subsequent', in context, refers to the decision which was the basis of the judgment of the court sought to be reviewed. Whether the
subsequent decision reversing or overruling or modifying the earlier decision was rendered prior or subsequent to the judgment sought to be
reviewed is immaterial. No distinction can be made between a decision rendered prior to the judgment or subsequent to it. If the submission of the
counsel is accepted, taking the proposition to its logical conclusion, it would lead to absurd results. No judgment or order of any court in that case
can be treated as final, for, there is always the possibility of a decision which was basis of the judgment, being reversed, overruled or modified by a
subsequent decision. In the instant case itself, theoretically speaking, the decision in National Insurance Co. Ltd v. Nicolletta Rahtagi (supra)
overruling the decision in United India Insurance Co. Ltd. v. Bhushan Sachdeva (supra) can be reversed by a larger Bench in future. If it happens,
the Insurance Company Would be rushing to this Court for another review of the judgment.
Relying on the principle embodied in the explanation to rule 1 of order XLVII as also on general principles, we find it difficult to accept the
proposition that where the decision which is the basis of the judgment is overruled, on the ground of subsequent decision the judgment can be
reviewed. The proposition, in our opinion is contrary to public policy as it would open a floodgate of litigation impinging on the finality of judgments
and orders and unsettling the rights of the parties.
Mr. Jan alternatively submitted that a judgment rendered in ignorance of the binding decision is a judgment per incurium and on that ground too
it can be reviewed. He referred to certain decisions. In our opinion, a judgment rendered per incurium may be set-aside in appeal, but that is no
ground for review. As is well known, review is admissible to correct mistake or error apparent on the face, of the record or on the basis of
discovery of new and important material which, not being within the knowledge of the applicant despite exercise of due diligence, could not be
produced by him when the judgment was delivered. The judgment rendered in ignorance of a binding decision of the court cannot be said to be an
error apparent on the face of the record nor it can be said to be discovery of a new material.
Mr. J.A. Kawoosa, learned counsel for the insurance Company, relying on a Full Bench decision of this Court in United Fire and General
Insurance Co. Ltd. Vs. Lakshmi Shori Ganjoo and Others, , Submitted that leave to contest the claim of the claimants on grounds other than those
specified in section 149(2), within the meaning of section 170 of the Act, can be either express or implied. In the aforesaid case, it was pointed
out, no express order granting leave to the Insurance Company to contest the claim on other grounds was passed by the Tribunal. The Full Bench
nevertheless upheld the right of the Insurance Company to contest the claim on other grounds and, also, question the quantum of compensation.
Mr. Kawoosa also submitted that the sum awarded by the Claims Tribunal was exorbitant and shocking and it would lead to unjust situation if, by
reviewing the judgment of the Division Bench, the award of the Tribunal is revived. Referring to the relevant parts of the judgment under review, he
further submitted that the Division Bench went into all relevant aspects of the claim, and after assessing the pecuniary and non-pecuniary damage
suffered by the claimants under different heads fixed compensation, reducing in that process compensation awarded by the Claims Tribunal. The
judgment being just and proper, does not warrant any interference. The submission appears to be well-founded.
In the above premises, we do not think it is a fit case for review of the judgment of the Division Bench. The review petition is, accordingly,
dismissed.